Things to know

Most foreign nationals can purchase property or land freehold in TURKIYE subject to certain provisos:

1. There must be a reciprocal agreement between TURKIYE and the relevant country. ( There are agreements between TURKIYE and most European countries )

2. The property may not be within the confines of a Military Security Zone.

Subject to these provisos being fulfilled there is just one official permission required, which can take up to three months, before a foreigner may purchase his or her land or property. This comprises a confirmation from the Military Authorities that the property is not in a sensitive military area. Having confirmed all the above criteria through your barrister, you are free to enter into a private purchase contract with the owner. At this stage a promissory sale contract (PsC) will be signed by both parties whether or not the military permission has arrived. It is now necessary to involve a barrister and pay a deposit or the full price of your property. If there are certain items of unfinished work to be completed on the property it is advisable to pay only a deposit. In any case it is best to consult a Barrister who can also act as your appointed represantative under the power of attorney (PoA), to complete the purchase and assist with the Military clearance. You have been warned !

PAYMENT PROCEDURE

This has been much simplified due to a recent change in Turkish Law. The money may be paid in full by any international bank transfer system or in cash. Mortgages with Turkish banks are currently restricted to Turks.

COSTS IN PURCHASING PROPERTY IN TURKIYE

1. Buyers tax : 1,5 % to the tax office / treasury

2. Sellers tax : 1,5 % to the tax office / treasury

3. Notaries fees : PsC + PoA 0.8 % - 1.5 % to the public notary

4. Registry of the promissory sale contract: 0.5 > 0.7 % to the tax office / treasury

5. Military Permission Expenses ± 0.1 %

ALL PERCENTAGES ARE BASED ON THE PURCHASE PRICE

Purchase prices include the above costs. The declared purchase price may sometimes differ from the actual purchase price. Additional to the above are legal fees per capita / head. Regarding structural and city planning surveys, they are not commonly carried out or necessary in TURKIYE, but can be done should sufficient information not already be available from your barrister

ON GOING COSTS

Annual cost the property tax is assessed on the "fair market value" for the property declared by the legal owner, hereafter referred to as the "declared" value. This must be above the value estimated by the municipality. The declared value is valid for 1 year, to be ratified by a certain percentage set by the State, the following 4 years. The payment is then 0.01% of that value for houses; 0.03% for land and 0.01% for agricultural land, made to the municipality. Refuse tax, introduced for houses in 2002 is around £ 5 > 25

IF YOU EVER DECIDE TO SELL

When you decide to sell your property, the original investment and the profit can be freely taken out of the country. The only costs payable at point of sale area 1,5 % sellers tax of " declared " value. Help of a barrister is advisable.

TAX POSITION : IN TURKIYE AND IN UNITED KINGDOM

"Declared" profit made on the disposal of a property is taxable in TURKIYE. In the event of rental income, the "declared" net amount is also taxable in TURKIYE. It is essential to take legal advice with reference to the "declared" values on your property. "Declared" rental income will be taxable in the U.K. in most cases. Relief against U.K. taxes for some of the Turkish taxes paid is available if the Turkish tax is an "admissable" tax. On disposal of the property the gain made, if "declared", would be regarded as a capital gain. The tax payable on the gain depends on the individual owner's tax position. There is a taxation agreement between the U.K. and TURKIYE signed 19th February 1986 which has now been ratified by the legislature of both countries that prevents double taxation. Again, professional advice is strongly recommended.

VISA REQUIREMENTS

Visas are not required for visits to TURKIYE of less than 90 days duration. For a stay exceeding three months a Residence Permit is necessary. This involves formal application to the Turkish Consulate at the start. Later, renewals will be carried out by Police Authorities and Department for Foreigners in the city or town in which you would like to stay. Bodrum itself has both these offices, with the province capital offices being in Mu?la. It is a legal requirement that all persons living in TURKIYE must register with the local area's muhtar, an official whose sole purpose is to maintain the register. It is strongly advised you do this and apply for a residence permit as soon as you are certain you will stay in TURKIYE for a period of time exceeding three months. Alternatively, if you leave the country before your visa expires, upon re-entry you can get a further three month visa.

WORKING IN TURKIYE

All foreigners working in TURKIYE must have work permits. It is the responsibility of employers to do this, but it is also up to you to ensure that the process has started and is continuing. A residence permit is necessary in conjunction with a work permit, also achieved with your employer's assistance.

IMPORTATION OF HOUSEHOLD GOODS

Only people taking up permanent residence in TURKIYE may freely import their household goods. Permanent residence usually means for retirement or marriage. Holders of a work permit and temporary residence permit make a temporary import whereas people taking up permanent residence may permanently import their possessions with no obligation to re-export the goods after a certain period. However if the temporary situation is extended beyond two years it automatically becomes permanent.

For people planning to use their property as a holiday or second home, it is very difficult, time-consuming and uneconomic to import household goods to TURKIYE unless they are of great sentimental value or family heirlooms. It is worth bearing in mind the high standard of workmanship in TURKIYE, the cheap servicing charges and valid guarantees on electrical products.

IMPORTATION OF PERSONAL EFFECTS

Personal effects such as clothes, shoes, books and linen in reasonable quantities are permitted to be imported. If one tries to import electrical items at the same time, for example radios, T.V. sets or videos, customs will temporarily confiscate the items in 90% of cases, making a note of them in your passport, and you will be required to pick them up on leaving the country. In the other 10%, if enough "guarantees" are deemed to have been found by customs they MAY allow the importation by entering the details on your passport and securing a financial guarantee from you. You have been warned!

IMPORTATION OF PRIVATE CARS / MOTORCYCLES

European Nationals may temporarily import a car or a motorbike to TURKIYE for a period of up to three months. Insurance is compulsory. An extended green card on your original insurance policy will be sufficient. A permanent resident with a work permit may bring a car to TURKIYE and apply for foreign registration blue number plates.